NEWARK, CA (September 27, 2012)  StemCells, Inc. (Nasdaq: STEM) today announced that the first
patient with an incomplete spinal cord injury has been enrolled in the Companys Phase I/II
clinical trial in chronic spinal cord injury and transplanted with the Companys proprietary
HuCNS-SC® neural stem cells. The patient, a Canadian man who suffered a thoracic spinal
cord injury from a sports-related accident, was administered the cells yesterday at Balgrist
University Hospital, University of Zurich, a world leading medical center for spinal cord injury
and rehabilitation. This is the first patient in the second cohort of the trial, which will be
comprised of four patients who retain some sensory function below the level of trauma and are
therefore considered to have an incomplete injury.

This is an important milestone for StemCells and the spinal cord injury community as it is the
first time anyone has ever transplanted neural stem cells into a patient with an incomplete
injury, said Stephen Huhn, MD, FACS, FAAP, Vice President and Head of the CNS Program at
StemCells, Inc. Given the encouraging interim data from the most severely injured patient cohort
that we reported earlier this month, testing patients with less severe injury should afford us an
even better opportunity to continue to test safety and to detect and assess clinical changes.
Unlike the patients in the first cohort, patients with incomplete injuries have retained a degree
of spinal cord function that might be even further augmented by transplantation with neural stem
cells.

Earlier this month, the Company reported that interim six-month data from the first patient cohort
in the Phase I/II clinical trial continued to demonstrate a favorable safety profile, and showed
considerable gains in sensory function in two of the three patients compared to pre-transplant
baselines. Patients in the first cohort all suffered a complete injury to their spinal cord,
leaving them with no neurological function below the level of injury. Following transplantation
with HuCNS-SC cells, there were no abnormal clinical, electrophysiological or radiological
responses to the cells, and all the patients were neurologically stable through the first six
months after transplantation. Changes in sensitivity to touch, heat and electrical stimuli were
observed in well-defined and consistent areas below the level of injury in two of the patients,
while the third patient remained stable. Importantly, the changes in sensory function were
confirmed objectively by measures of electrical impulse transmission across the site of injury,
each of which correlated with the clinical examination.

About the Spinal Cord Injury Clinical Trial

The Phase I/II clinical trial of StemCells, Inc.s HuCNS-SC® purified human adult neural stem cells
is designed to assess both safety and preliminary efficacy. Twelve patients with thoracic
(chest-level) neurological injuries at the T2-T11 level are planned for enrollment, and their
injuries must have occurred within three to twelve months prior to transplantation of the cells.
In addition to assessing safety, the trial will assess preliminary efficacy based on defined
clinical endpoints, such as changes in sensation, motor function and bowel/bladder function. The
Company has dosed the first patient cohort, all of whom have injuries classified as AIS A according
to the American Spinal Injury Association Impairment Scale (AIS). In AIS A injuries, there is no
neurological function below the injury level. The second cohort will be patients classified as AIS
B, in which there is some preservation of sensory or motor function below the injury level. The
third cohort will be patients classified as AIS C, in which there is some preservation of both
sensory and motor function.

All patients will receive HuCNS-SC cells through direct transplantation into the spinal cord and
will be temporarily immunosuppressed. Patients will be evaluated regularly in the post-transplant
period in order to monitor and assess the safety of the HuCNS-SC cells, the surgery and the
immunosuppression, as well as to measure any recovery of neurological function below the injury
site. The Company intends to follow the effects of this therapy long-term, and each of the
patients will be invited to enroll into a separate four year observational study after completing
the Phase I/II study.

The trial is being conducted at Balgrist University Hospital, University of Zurich, a world leading
medical center for spinal cord injury and rehabilitation, and is open for enrollment to patients in
Europe, Canada and the United States. Enrollment for the second cohort is now underway. If you
believe you may qualify and are interested in participating in the study, please contact the study
nurse either by phone at +41 44 386 39 01 or by email at stemcells.pz@balgrist.ch.

Additional information about the Companys spinal cord injury program can be found on the
StemCells, Inc. website at
http://www.stemcellsinc.com/Therapeutic-Programs/Clinical-Trials.htm and at
http://www.stemcellsinc.com/Therapeutic-Programs/Spinal-Cord-Injury.htm, including video
interviews with Company executives and independent collaborators.

About Balgrist University Hospital

Balgrist University Hospital, University of Zurich is recognized worldwide as a highly
specialized center of excellence providing examination, treatment and rehabilitation opportunities
to patients with serious musculoskeletal conditions. The clinic owes its leading international
reputation to its unique combination of specialized medical services. The hospitals
carefully-balanced, interdisciplinary network brings together under one roof medical specialties
including orthopedics, paraplegiology, radiology, anesthesiology, rheumatology, and physical
medicine. More information about Balgrist University Hospital is available at
www.balgrist.ch.

About StemCells, Inc.

StemCells, Inc. is engaged in the research, development, and commercialization of cell-based
therapeutics and tools for use in stem cell-based research and drug discovery. The Companys lead
therapeutic product candidate, HuCNS-SC® cells (purified human neural stem cells), is currently in
development as a potential treatment for a broad range of central nervous system disorders. In a
Phase I clinical trial in Pelizaeus-Merzbacher disease (PMD), a fatal myelination disorder in
children, the Company has shown preliminary evidence of progressive and durable donor-derived
myelination in all four patients transplanted with HuCNS-SC cells. The Company is also conducting
a Phase I/II clinical trial in chronic spinal cord injury in Switzerland and has reported positive
interim data for the first patient cohort. The Company has also initiated a Phase I/II clinical
trial in dry age-related macular degeneration (AMD), and is pursuing preclinical studies in
Alzheimers disease. StemCells also markets stem cell research products, including media and
reagents, under the SC Proven® brand. Further information about StemCells is available at
http://www.stemcellsinc.com.

Apart from statements of historical fact, the text of this press release constitutes
forward-looking statements within the meaning of the Securities Act of 1933, as amended, and the
Securities Exchange Act of 1934, as amended, and is subject to the safe harbors created therein.
These statements include, but are not limited to, statements regarding whether the improvements in
sensory function seen in the Companys Phase I/II clinical study of spinal cord injury will persist
and whether they will prove to be clinically meaningful; continued authorization to conduct a
clinical trial in Switzerland in chronic spinal cord injury; the prospect for screening and then
enrolling patients into the AIS B and AIS C cohorts; the prospect for evaluating trial patients for
changes in their sensation, motor function and bowel/bladder function; the potential of the
Companys HuCNS-SC cells to treat spinal cord injury and other central nervous system disorders;
and the future business operations of the Company, including its ability to conduct clinical trials
as well as its other research and product development efforts. These forward-looking statements
speak only as of the date of this news release. The Company does not undertake to update any of
these forward-looking statements to reflect events or circumstances that occur after the date
hereof. Such statements reflect managements current views and are based on certain assumptions
that may or may not ultimately prove valid. The Companys actual results may vary materially from
those contemplated in such forward-looking statements due to risks and uncertainties to which the
Company is subject, including the fact that additional trials will be required to demonstrate the
safety and efficacy of the Companys HuCNS-SC cells for the treatment of any disease or disorder;
uncertainty as to whether the FDA or other applicable regulatory agencies will permit the Company
to continue clinical testing in PMD, spinal cord injury or in future clinical trials of proposed
therapies for other diseases or conditions given the novel and unproven nature of the Companys
technologies; uncertainties regarding the Companys ability to recruit the patients required to
conduct its clinical trials or to obtain meaningful results; uncertainties regarding the Companys
ability to obtain the increased capital resources needed to continue its current and planned
research and development operations; uncertainty as to whether HuCNS-SC cells and any products that
may be generated in the future in the Companys cell-based programs will prove safe and clinically
effective and not cause tumors or other adverse side effects; uncertainties regarding the Companys
ability to commercialize a therapeutic product and its ability to successfully compete with other
products on the market; and other factors that are described under the heading Risk Factors in
the Companys Annual Report on Form 10-K for the year ended December 31, 2011, and in its
subsequent reports on Form 10-Q and Form 8-K.

Site Links

Based on public records. Inadvertent errors are possible. Getfilings.com does not guarantee the accuracy or timeliness of any information on this site. Use at your own risk.
This website is not associated with the SEC.